The last time a story of Tungsten-filled gold appeared on the scene was just two years ago, and involved a 500 gram bar of gold full of tungsten, at the W.C. Heraeus foundry, the world’s largest metal refiner and fabricator. It also became known that said “gold” bar originated from an unnamed bank. It is now time to rekindle the Tungsten Spirits with a report from ABC Bullion of Australia, which provides photographic evidence of a new gold bar that has been drilled out and filled with tungsten rods, this time not in Germany but in an unnamed city in the UK, where it was intercepted by a scrap metals dealer, and was supplied with its original certificate. The reason the bar attracted attention is that it was 2 grams underweight. Upon cropping it was uncovered that about 30-40% of the bar weight was tungsten. So two documented incidents in two years: isolated? Or indication of the same phenomonenon of precious metal debasement that marked the declining phase of the Roman empire. Only then it was relatively public for anyone who cared to find out on their own. Now, with the bulk of popular physical gold held in top secret, private warehouses around the world, where it allegedly backs the balance sheets of the world’s central banks, yet nobody can confirm its existence, nor audit the actual gold content, it is understandable why increasingly more are wondering: just how much gold is there? And alongside that – while gold, (or is it GLD?), can be rehypothecated, can one do the same with tungsten?

ABC Bullion received the following email from one of our trusted suppliers this week.

Note:

It was not ABC Bullion that purchased this bar, the email and photos were sent to us as a general warning.

I xxxx’ed out the city’s name to avoid any second guessing as to the name of the dealer.

19/03/2012:

Attached are photographs of a legitimate Metalor 1000gm Au bar that has been drilled out and filled with Tungsten (W).

This bar was purchased by staff of a scrap dealer in xxxxx, UK yesterday. The bar appeared to be perfect other than the fact that it was 2gms underweight. It was checked by hand-held xrf and showed 99.98% Au. Being Tungsten, it would not be ferro-magnetic. The bar was supplied with the original certificate.

The owner of the business that purchased the bar only became suspicious when he realized the weight discrepancy and had the bar cropped. He estimates between 30-40% of the weight of the bar to be Tungsten.

This is very worrying and reinforces the lengths that people are willing to go to profit from the current high metal prices. Please be careful.

“On Wednesday, the BBC reported that millions of dollars in gold at the central bank of Ethiopia has turned out to be fake: What were supposed to be bars of solid gold turned out to be nothing more than gold-plated steel. They tried to sell the stuff to South Africa and it was sent back when the South Africans noticed this little problem. This is an amazing story for two reasons. First, that an institution like a central bank could get ripped off this way, and second that the people responsible used such a lousy excuse for fake gold. I consider myself something of an expert on fake gold (I’m not really, I just think I am) ever since I was asked to give advice on the subject to the author Damien Lewis for his recent thriller, Cobra Gold. I worked out in detail for him how you could make really convincing fake gold, and ended up as a minor character in the novel, where I am known as “Goldfinger Gus”.

The problem with making good-quality fake gold is that gold is remarkably dense. It’s almost twice the density of lead, and two-and-a-half times more dense than steel. You don’t usually notice this because small gold rings and the like don’t weigh enough to make it obvious, but if you’ve ever held a larger bar of gold, it’s absolutely unmistakable: The stuff is very, very heavy.

The standard gold bar for bank-to-bank trade, known as a “London good delivery bar” weighs 400 troy ounces (over thirty-three pounds), yet is no bigger than a paperback novel. A bar of steel the same size would weigh only thirteen and a half pounds. According to the news, the authorities have arrested pretty much everyone involved, from the people who sold the bank the gold, to bank officials, to the chemists responsible for testing and approving it on receipt.

The problem is, anyone who so much as picked up one of these bars should have known immediately that they were fake, no fancy test required. The weight alone is an instant dead giveaway. Even a forklift operator lifting a palette full of them should have noticed that his machine wasn’t working hard enough. I think they must have been swapped out while in storage: Someone walked in each day with a new fake gold bar and walked out with a real one. If they were fake on arrival then everyone who handled them in any way must have either had no experience with gold or been in on the scam.

Now, for me the more interesting question is, how do you make a fake gold bar that at least passes the pick-it-up test? The problem is that there are very few metals that are as dense as gold, and with only two exceptions they all cost as much or more than gold. The first exception is depleted uranium, which is cheap if you’re a government, but hard for individuals to get. It’s also radioactive, which could be a bit of an issue.

The second exception is a real winner: tungsten. Tungsten is vastly cheaper than gold (maybe $30 dollars a pound compared to $12,000 a pound for gold right now). And remarkably, it has exactly the same density as gold, to three decimal places. The main differences are that it’s the wrong color, and that it’s much, much harder than gold. (Very pure gold is quite soft, you can dent it with a fingernail.)

A top-of-the-line fake gold bar should match the color, surface hardness, density, chemical, and nuclear properties of gold perfectly. To do this, you could could start with a tungsten slug about 1/8-inch smaller in each dimension than the gold bar you want, then cast a 1/16-inch layer of real pure gold all around it. This bar would feel right in the hand, it would have a dead ring when knocked as gold should, it would test right chemically, it would weigh *exactly* the right amount, and though I don’t know this for sure, I think it would also pass an x-ray fluorescence scan, the 1/16″ layer of pure gold being enough to stop the x-rays from reaching any tungsten. You’d pretty much have to drill it to find out it’s fake. (Unless, of course, central bank gold inspectors are wise to this trick and have developed a test for it: Something involving speed of sound say, or more powerful x-rays, or perhaps neutron activation analysis. If bars like this are actually a common problem, you certainly could devise a quick, non-destructive test for them, and for all I know, they have. Except, apparently, in Ethiopia.)

Such a top-quality fake London good delivery bar would cost about $50,000 to produce because it’s got a lot of real gold in it, but you’d still make a nice profit considering that a real one is worth closer to $400,000. A lower budget version could be made by using the same under-sized tungsten slug but casting lead-antimony alloy around it (to match the hardness, sound, and feel of gold), then electroplating on a heavy coating of gold. Such a bar would still feel and sound right and be only very slightly underweight, while costing less than $500 to produce in quantity. It would not pass x-ray fluorescence, and whether it passes a chemical test would depend on how thick the electroplating is.

This is the solution I recommended for Cobra Gold, because they only needed their fake gold to pass a field inspection, which is to say, someone picking it up and knowing what gold should feel like when you lift it. You may quibble for other aspects of the plot if you like, but I think the fake gold would have worked. And let me tell you, it’s a sad day for criminal masterminds when my fictional fake gold, designed only to trick a terrorist cell, is so much better than the real fake gold used to rip off a real government bank for millions of real dollars.”

Malleable things can be hammered thinner without breaking; ductile things can be stretched thinner without snapping. Every material has its limit, but with gold, that limit is just a few hundred atoms thick. Gold is the most malleable and the most ductile of all metals. A cube of it about 21/2 inches on edge could be beaten out to cover an entire football field (at a cost of roughly $68,000, plus beating fees). Gold this thin is called gold leaf, and the ancient art of applying it for decoration is called gilding.

How thin is gold leaf? Using my steel rolling mill, I can make gold foil about one thousandth of an inch thick, similar to aluminum foil. Thin, sure, but gold leaf is nearly 500 times as thin as that. Only then does it become affordable enough and flexible enough to be used almost like paint to cover finely detailed carvings or anything else you want to be shiny for years to come. To make gold leaf, start with gold foil, interleave a few dozen squares of it with layers of special vellum (so the foil sheets don´t stick to one another), and beat the heck out of the stack with a 16-pound hammer for many hours, turning the squares into larger squares of thinner foil. Then cut the sheets in quarters, restack them, and pound them out again. The malleability of gold is what allows the sheets to just keep getting thinner and thinner without splitting. (OK, I admit, I tried and failed at this. Just haven´t got the arm for it. Or the proper vellum, or the family secrets handed down over generations. Making gold leaf is, like other ancient arts, not quite the garage project it might seem.)

Gilding, on the other hand, is not a particularly difficult skill. To gild a home-run baseball, I used commercially prepared gold leaf from an art-supply store. The process is simple: Paint the object with a sticky liquid called gold size, lay the sheets of gold leaf on, and rub them in. The catch is the part where you try to pick up the leaf. Don´t even think about using your fingers-this stuff is more like a soap bubble than a sheet of metal and will start wrapping around your fingers and then tear the instant you try to unwrap it. Brushes known as gilders´ tips, made of red-squirrel hair (none of that gray-squirrel crap, mind you) are used to pick up the sheets by static electricity. It takes a delicate touch, but at $2 per four-inch-by-four-inch sheet, you´re motivated to learn fast.

Gold leaf instantly welds to itself. Overlapping layers fuse together invisibly when rubbed in, so even if you´re sloppy, the end result will look smooth. It´s OK to touch it with your fingers at this point because the gold size will hold it in place. Gilded objects survive from 5,000 years ago (think King Tut´s mask), proving that gold is impervious to air, water, alkalis and most acids, no matter how thin it is.

1. Mini rolling mill squeezes one gram of gold into foil, which is still about 500 times as thick as gold leaf.
2. Gold leaf held to a squirrel-hair brush by static electricity, ready to be applied.

Ethiopia’s national bank has been told to inspect all the gold in its vaults to determine its authenticity. It follows the discovery that some of the “gold” it had bought for millions of dollars was gold-plated steel. The first hint that something was wrong reportedly came when the Ethiopian central bank exported a consignment of gold bars to South Africa. The South Africans sent them back, complaining that they had been sold gilded steel. An investigation revealed that the bank had bought a consignment of fake gold from a supplier, who is now under
arrest.

Other arrests followed, including business associates of the main accused; national bank officials; and chemists from the Geological Survey of Ethiopia, whose job it is to assay the bank’s purchases of gold and certify that they are real. But what has clearly now got the government even more worried is that another different batch of gold in the bank’s vaults has also been found to be fake, and this time it was gold which had been there for several years, after being seized from smugglers trying to take it to Djibouti.

Mining
The Ethiopian parliament’s budget and finance committee ordered the inspection of all gold in the national bank’s vaults. A report from the auditor-general on the affair is expected to be presented to parliament during its current session. Gold is mined in Ethiopia in considerable quantities, and a trader selling gold to the central bank has to have it tested and certified by the Geological Survey. Whether the bank bought fake gold in the first place, or whether real gold from the vaults has been swapped for gilded steel, the fraud has cost the bank many millions of dollars, and it must have involved collusion on a considerable scale.

It was one of the most secretive missions at a factory that was all about secrecy: Nuclear warheads, retired from service and destined for the junkyard, were trucked at night to the Paducah Gaseous Diffusion Plant to be dismantled, hacked into unrecognizable pieces and buried. Workers used hammers and acetylene torches to strip away bits of gold and other metals from the warheads’ corrosion-proof plating and circuitry. Useless parts were dumped into trenches. But the gold – some of it still radioactive – was tossed into a smelter and molded into shiny ingots.

Exactly what happened next is one of the most intriguing questions to arise from a workers’ lawsuit against the former operators of the U.S.-owned uranium plant in western Kentucky. Three employees contend that the plant failed for years to properly screen gold and other metals for radioactivity. Some metals, they say, may have been highly radioactive when they left Paducah, bound perhaps for private markets.

The claim – based partly on circumstantial evidence – is now being investigated by Department of Energy officials who are also probing the workers’ accounts of plutonium contamination and alleged illegal dumping of radioactive waste at the uranium plant. “It is my belief that these recycled metals were injected into commerce in a contaminated form,” Ronald Fowler, a radiation safety technician at the plant, states in court documents that were unsealed this week by the Justice Department.

The investigation comes amid heightened scrutiny of government efforts to recycle valuable metals piling up at more than 16 factories that are part of the U.S. nuclear weapons complex. In the past week, congressional leaders, industry officials and scores of environmental groups have called on the Clinton administration to reconsider a controversial Department of Energy program to recycle scrap metal from nuclear weapons facilities into products that could end up in household goods or even children’s braces.

Opponents’ concerns soared this week with revelations, first reported in The Washington Post, that plutonium and other highly radioactive metals slipped into the Paducah plant over a 23-year period in shipments of contaminated uranium. The plutonium accumulated over decades in nickel-plated pipes where uranium was processed into fuel for bombs, government documents show. Smaller amounts of tainted uranium went to sister plants at Oak Ridge, Tenn., and Portsmouth, Ohio, the records show.

Scrap nickel from those plants is now the primary target of the Energy Department’s metal recycling program, which would be run jointly by the federal government, the state of Tennessee and a private contractor, British Nuclear Fuels Ltd. (BNFL). “If DOE denied or didn’t know plutonium was present at Paducah, why should we trust them to release waste from identical production plants into products ranging from intrauterine devices to hip replacements?” asked Wenonah Hauter of the watchdog group Public Citizen, one of 185 organizations to sign a letter to Vice President Gore Thursday demanding a halt to the program.

Recovering gold and other valuable metals from retired nuclear weapons had been a little-known mission of the government’s uranium enrichment plants over the past five decades. At Paducah, the process began in the 1950s and was conducted under extraordinary security, with heavily armed guards escorting warheads into the plant under cover of darkness. Garland “Bud” Jenkins, one of three Paducah workers involved in the lawsuit filed under seal in June, says he worked for several years in Paducah’s metals program recovering gold, lead, aluminum and nickel from nuclear weapons and production equipment. “We melted the gold flakes in a furnace to create gold bars,” Jenkins said in court documents. “The gold was never surveyed radiologically prior to its release, to my knowledge.”

Jenkins also says he never saw tests performed on nickel and aluminum ingots that were hauled out of the plant in trucks. In later years, when plant managers did begin screening the metals, many were found to be contaminated, he said. Hundreds of nickel ingots are still stored at the plant, too tainted to go anywhere, he said. A plant report included in the lawsuit filings may shed light on the degree of contamination in the gold. In a radiological survey of the plant last year, technicians discovered gold flakes inside an old ingot mold used for gold recovery. The fish scale-sized flakes were tested and found to emit radiation at a rate of 500 millirems an hour, the report said. By comparison, the average person receives between 200 and 300 millirems each year from all sources, including X-rays, radon gas and cosmic radiation from space. “If you had a wedding ring made out of those flakes you’d be getting twice as much radiation in an hour as most people get in a year,” said Joseph R. Egan, a lawyer representing the employees.

Fowler, the radiation safety technician, said he filed a report on the discovery of the radioactive gold in December but received no response from the plant’s management. Nothing further was done to investigate “the possibility that [the plant] may have contaminated the nation’s gold supply” at Fort Knox, he said. Plant officials shed little light on the process. U.S. Enrichment Corp., the plant’s current operator, says gold recovery at Paducah was the responsibility of the Energy Department. Department officials, in a response to written questions from The Post, acknowledged that gold was recovered from nuclear weapons at Paducah. But, “since these actions occurred many years ago, information regarding their past dispositions is not readily available,” the statement said.

In a letter to Rep. John D. Dingell (D-Mich.)., department officials strongly defended their efforts to salvage nickel and other valuable metals that have been piling up at nuclear complex sites for years. “Let me assure you that the safety of the public and workers and compliance with state and federal regulations are of paramount importance,” said Undersecretary of Energy T.J. Glauthier. Glauthier said BNFL’s license requires that “any metals released for unrestricted use will not pose a risk to human health or the environment.”

The recycling program, announced in 1996 by Gore as part of his “reinventing government” initiative, was touted at the time as a “win-win” deal for the environment, industry and taxpayers. BNFL, which was awarded the recycling contract in a noncompetitive bid, has already begun recycling some of the 100,000 tons of radioactively contaminated metal that were once part of the defunct K-25 complex at Oak Ridge, the world’s first full-scale uranium enrichment plant. Eventually the program expanded to Paducah and other facilities.

Purifying nickel is technically difficult because the radioactive contamination extends below the surface of the metal. According to department officials, BNFL was awarded the contract because it has developed a unique technology that can safely remove nearly all of the contaminants. But opponents say the technology has never been proven on such a large scale. Moreover, they note, there are no federal standards for releasing contaminated metal into the marketplace. Previous attempts to set such standards in the early 1990s were abandoned because of public opposition.

And, opponents add, the lack of restrictions on the recycled metal leaves the public in the dark about which products may have come from contaminated scrap. Even if radioactivity levels are low, consumers are entitled to an informed choice when buying materials that might be used by children, activists said. “The DOE has admitted they can’t protect the safety of their workers and misled them,” said Robert Wages, executive vice president of the Paper, Allied-Industrial, Chemical & Energy Workers International Union. “Now DOE wants to dump radioactive metals into everything from baby rattles to zippers . . . and tell us not to worry.”

Because there are no federal standards, the Energy Department’s recycling program relies on the state of Tennessee to set guidelines and regulate the process. In June, a federal judge sharply criticized the arrangement, saying the DOE had effectively thwarted public debate of an issue in which “the potential for environmental harm is great.” But U.S. District Judge Gladys Kessler rejected an attempt by labor and environmental groups to halt the recycling program, citing a law that prohibits courts from delaying federal cleanup of contaminated sites. Still, in unusually blunt language, the judge accused the Energy Department of “startling and worrisome” behavior in its alleged attempts to avoid federal oversight and public review. “There has been no opportunity at all for public scrutiny or input on such a matter of such grave importance,” Kessler wrote in her opinion. “The lack of public scrutiny is only compounded by the fact that the recycling process which BNFL intends to use is entirely experimental at this stage.”

Let’s consider the run-up to Rome’s hyperinflation. I think this comment from jaysromanhistory.com “Good Money, Bad Money, and Runaway Inflation” resonates with what’s happening in the US today:

“Severus Alexander (AD 222-235) tried to reform by going back to the denarius but, once started, this path of runaway inflation and financial irresponsibility on the part of the imperial government proved impossible to control.”

It also seems that the hyperinflation was preceded by some kind of banking crisis, which is an interesting parallel. From “Demise and Fall of the Augustan Monetary System” by Koenraad Verboven:

“Papyri show it was common for private individuals to deposit money at a bank and to make and accept payments through bankers.Bankers in the west disappear from view around the middle of the 3rd c… A famous papyrus from Oxyrhynchus from 260 CE shows exchange bankers closing in order to avoid having to change the ‘imperial money’. The strategos ordered the exchange bankers to reopen and accept all genuine coins and warned businessmen to do the same. In 266 CE we find for the first time transactions being expressed in ‘ptolemaeic’ or ‘old silver’ as opposed to ‘new silver’.”

The chart shows how inflation remained relatively subdued until a tipping point was reached in the late- 260s A.D Monetary systems can absorb substantial abuse before there is a dramatic impact on the price level. For example, the debasement of the coinage was already accelerating in the early part of the third century A.D., before plunging in the latter part. Indeed, the chart below (apologies for the quality) only shows the trend up to 253 AD. By around 290 AD, the coins were only dipped in silver to give them a coating (<0.5%).

“A popular and recurring conspiracy theory, as alleged by Edward Durrell, Norman Dodd, Tom Valentine, Peter Beter and others, claims that the vault is mostly empty and that most of the gold in Fort Knox was removed to London in the late 1960s by President Lyndon Johnson. [3] In response, on September 23, 1974, Senator Walter Huddleston of Kentucky, twelve congressmen, and about 100 members of the news media toured the vault and opened various cells and doors, each filled with gold. Radio reporter Bill Evans, when asked if it seemed like the gold might have been moved in just for the visit, replied that “all I can say is that I saw gold there” and that it seemed like it was always there.[4] Additionally, audits of the gold by the General Accounting Office (in cooperation with the United States Mint and the United States Customs Service in 1974 and the Treasury Department) from 1975-1981 found no discrepancies between the reported and actual amounts of gold at the Depository.[5] However, the audit has been described as a peculiar process because it was only a partial audit done over an extended period of time.[6] The report states only 21 percent of the gold bars were audited as of 1981 (the audit report’s issue date) and that the audit has “covered more than 212.7 million fine troy ounces of gold” which “represents over 80 percent of the total amount of United States-owned gold of 264.1 million fine troy ounces.”[5] A small amount of gold is removed for regularly scheduled audits to ensure the purity matches official records.[1] The theory continues to persist, however. Of this alleged scandal, the ex-general counsel of the Export-Import Bank of the United States, Peter Beter, commented: “The Watergate scandal was child’s play compared with the covered-up Fort Knox Gold Scandal”.[7]”

IAN FLEMING and the FT. KNOX GOLD SCANDAL
In writing his stories, Ian Fleming was drawing upon his own secret weapon. That weapon was knowledge. Fleming had been a high-ranking officer of Britain’s crack Intelligence agency called MI-5. It was the British who practically invented and perfected the modern concept of Intelligence, and to this day British Intelligence remains the equal of any in the world.

When Fleming left Her Majesty’s Secret Service to become a writer, he was severely limited in what he could publish. He was bound by the restrictions of the British “Official Secrets Act.” Under that Act, Fleming would have been liable for punishment for revealing any official secret without authorization. And so Ian Fleming, the former British Intelligence officer, became what is known as a “fictionalizer”–that is, he started with factual knowledge but rearranged and modified it in order to create startling stories of fiction. He was always extremely careful about how he did this. He always knew that he was skirting the fringes of the Official Secrets Act. He could not afford to make a mistake, because it would have meant prison for him and possible forfeiture of pension rights; and so he always altered every situation, every secret technology, and every personality enough to avoid revealing actual secrets. It was a long and meticulous process both to protect himself and to make each final story readable. For that reason Fleming completed a new James Bond novel only about once a year. If it had all been imagination, as many people believe, he would have been capable of producing a new book every few months, making himself far richer. But because his stories were all rooted in fact, secret fact, he did not dare speed up and run the risk of making a mistake.

Ian Fleming had two purposes in writing his famous series of spy novels. One purpose, of course, was to earn a very comfortable living; but beyond that he was also trying to subtly open the eyes of the reading public by the medium of fiction. Because of the Official Secrets Act he could not publish the facts that he knew as fact without modification, so he did what he felt was the next best thing, and that was to use his stories to open our minds to at least think in terms which were otherwise hidden from us. Fleming truly believed that this was something which somehow had to be done, because knowing what he knew he was not an optimistic man.

A perfect example of all of this took place with a book Fleming published 21 years ago in 1959. It was titled “GOLD FINGER.” The starting point for the book was knowledge about certain secrets. Fleming knew that there was a long-range plan to create monetary chaos for private gain and power. He also knew that a central feature of the plan was to be the secret disappearance of America’s monetary gold hoard at Fort Knox, and he knew that the kingpin of this international plot was a man with legendary greed for gold. His name: DAVID ROCKEFELLER. It was a plan that was totally unsuspected by the public. It was still the Eisenhower era, the heyday of the so-called “almighty dollar.” The dollar was good as gold, because it was backed by the world’s largest monetary gold hoard. Fort Knox was thought to be impregnable; and in those days, my friends, no one dared speak ill of the Four Rockefeller Brothers.

Ian Fleming decided to write a book that would begin to alert people to what was afoot. He could not tell the whole story, nor tell it as fact because of the Official Secrets Act; but by fictionalizing he was able to cause people to think of possibilities which would never have occurred to them otherwise. For example, in the 50’s it was a rare American who considered even the possibility of monetary turmoil. The dollar was good as gold, and that was that. Why even think about gold? Individual citizens could not own it except in jewelry. Wasn’t all the rest of it thought to be sealed up in Fort Knox? Everyone knew no one could get in there, and so we didn’t even think about it. But in his book GOLD FINGER, Fleming brought several key thoughts to our minds. He devised a fictional scheme to show that Fort Knox might not be impregnable after all. He raised the question: “What would happen to the dollar and other currencies if the Fort Knox gold were no longer available?” And he proposed the unthinkable thought that someone, if they were rich enough and greedy enough, might want to get their hands on America’s gold.

The actual GOLD FINGER story, of course, was fiction; but the basic points which I have just mentioned were fact. GOLD FINGER was published in 1959; and barely two years later in 1961, the hemorrhaging of America’s monetary gold supply began. Agents of David Rockefeller within the United States Government provided a cloak of authority called the “London Gold Pool Agreement”; and then for seven years until 1968, big Army trucks loaded with gold bullion rolled out of Fort Knox constantly–and all without a word to the public!

Some of the gold shipments during those seven years were recorded on a list kept by the United States Mint. Almost without exception the shipments listed went to the New York Assay Office, where they disappeared without any further accounting. As you may recall, the New York Assay Office was the focus of a scandal in December 1978 involving missing gold. Over 5,000 ounces had simply disappeared; but that, my friends, was a very small tip of a very large iceberg, and so the controversy over the missing millions in gold at the New York Assay Office was quickly smoothed over and covered up. They could not afford to allow any real investigation which might let the public know the truth. According to the official list of shipments I mentioned earlier, a large fraction of America’s monetary gold went to the New York Assay Office in the 60’s. There it disappeared, never to be seen again.

But, my friends, the real situation was even worse. Long ago my sources gave me hard evidence of many large gold shipments from Fort Knox which were not even listed. Five years ago this month in AUDIO LETTER No. 2 I revealed a specific example of this. It was a shipment on January 20, 1965, in which four (4) tractor-trailers loaded up at Fort Knox and then headed for railroad tracks across the river at Jeffersonville, Indiana. My sources provided me with details, including photographs, of the operation. But the shipment was one of many which did not show on any official Government list of shipments.

In June 1975, Mr. Edward Durell and my other associates were able to confront officials of the United States Mint with this example of missing shipments, and for once the confrontation took place under circumstances in which the Mint was under great pressure to respond. In the most specific terms the Bureau of the Mint was asked what was shipped out of Fort Knox in the four tractor-trailers on January 20, 1965. The written answer dated June 19, 1975 came from the then Director of the United States Mint, Mrs. Mary Brooks. She confirmed that this unlisted shipment amounted to more than one and three-quarter (1-3/4) million ounces of gold–and, my friends, it was not junk gold melted down from old coins which were confiscated from Americans in 1934. The shipment was part of America’s true monetary gold, good delivery gold which is .995 fine or better. After this admission in writing about an enormous secret shipment of gold out of Fort Knox, one would have thought that there would be fireworks, but not so!

My friend Mr. Durell showered the appropriate officials throughout the Government with this evidence of massive fraud at Fort Knox, and he notified the major media and all of the appropriate leaders in Congress about this evidence. For reasons which I will explain later in this message, I believe it’s time to call attention to one of these people. He is Senator William Proxmire of Wisconsin, Chairman of the Senate Banking Committee.

Proxmire loves to parade as a great defender of our financial interests in Washington. He’s famous for his so-called “Golden Fleece Award.” Proxmire searches through the Federal Budget with a fine-tooth comb, and he’s always able to find some project or contract which rightly or wrongly will look ridiculous to the public. He then trots it out, announces how much it costs, and with a great flourish gives it his Golden Fleece Award. By this and other means Proxmire is a master at maintaining his image as a protector of the American economy.

But if ever a situation deserved the Proxmire Golden Fleece Award, it is the FORT KNOX GOLD SCANDAL. The petty examples usually chosen by Proxmire fleece the American public out of perhaps hundreds of thousands or a few million dollars. It makes good publicity for Proxmire, but it’s insignificant. By contrast, the Fort Knox Gold Scandal is fleecing every one of us out of the shirt on our back. It has undermined the dollar itself, which is on its way to destruction. It has set off ever-worsening inflation even while our economy is stagnating. The Gold Scandal is fleecing us all, but what has Senator William Proxmire done about that??

Let me tell you what he has, and has not, done. For more than five years Proxmire has been among the top American leaders who have been kept informed about major developments and evidence in the Gold Scandal. He has been given the evidence I mentioned earlier about the missing shipment from Fort Knox, as well as other evidence of major discrepancies; but up to now, Proxmire has kept his lips sealed about discrepancies about America’s gold supply–with one exception. That exception took place in December 1978. Word had leaked out about the 5,000-or so missing ounces of gold at the New York Assay Office worth over $3,000,000 at today’s prices. As Chairman of the Senate Banking Committee, Proxmire immediately jumped on the story. Frowning in disapproval, he proclaimed that this would have to be looked into. Hearing those words from the champion of the Golden Fleece Award, the public relaxed and quickly forgot about it. And almost as quickly, Senator William Proxmire made sure he forgot about it too. To this day, no real investigation has ever taken place over the missing gold at the New York Assay Office.

Proxmire’s failure to follow up that $3,000,000 gold discrepancy was bad enough, but it’s nothing compared to his apparent disinterest in investigating the truth about the Fort Knox Gold Scandal. The case of the missing Fort Knox shipment is a case in point. At today’s prices, that one shipment alone was worth more than one billion dollars ($1,000,000,000)–not a mere million but 1000 times a million! And that, in truth, was only one example. There were many unreported shipments like that. That is why the Treasury figures, which show a huge remaining American gold hoard, are a fraud–a total fraud. And that’s why the United States could auction off only a small amount of junk gold over a period of time and then had to stop. And that’s why the United States dollar is no longer “as good as gold”; instead, it’s fast becoming worth less than the paper it’s printed on.

Senator William Proxmire, like many others trusted by the American public, has been given massive evidence about all of this; but his actions so far have helped only those who have taken our own gold in order to fleece us of everything we own. Later in this message I will have more to say about Senator William Proxmire and the Fort Knox Gold Scandal. But for now I want to finish the story of Ian Fleming’s aborted efforts to alert the public about things like these. As I already explained, his principle was “Fictionalize to open eyes”; but after his untimely death in 1964 his stories were seized upon and warped, especially in movies, for the opposite purpose. The new purpose became “Fictionalize to CLOSE eyes.” Nothing could be done to alter and neutralize Fleming’s books once they had been published, so instead attention was drawn away from the books to the James Bond movies; and as the movies were in preparation, disinformation agents were planted on the scene to guide the process. As a result, the James Bond who emerged on film was a very different character from the one in Fleming’s novels. The basic story lines remained the same, but in many subtle ways the psychology was radically changed. The movies retained the adventure, fast action, dazzling secret technologies, and bold plots which Fleming had pioneered; but by clever use of satirical humor, every James Bond movie ended up by laughing at itself. Secret weapons were exaggerated or twisted so as to make them entertaining but also ridiculous; and by filling the movies with strange characters and never-ending gimmicks, viewers were distracted from the underlying warnings of the basic plot.

The GOLD FINGER story was a perfect example of all this. Fleming’s original novel called attention to something which most readers would never have thought about otherwise. That was the potential relationship between Fort Knox gold and international monetary chaos, and through his fictional plot he also planted the idea that the legendary Fort Knox bullion depository might not be invulnerable after all. But these lessons were rarely, if ever, realized by those who saw only the movie; instead, the typical viewer walked out of the movie laughing. It was obviousthat what he had seen could happen only in fiction, and from that point onward he was programmed to react with disbelief if he should ever hear of tampering with Fort Knox gold. Such a thing could only be fiction–it was just too ridiculous ever to really happen.

This is the attitude I encountered more than seven years ago when I began giving public warnings about deliberate plans for economic chaos. I myself was first alerted to the Fort Knox Gold Scandal by none other than British Intelligence in London after completing a secret mission for Queen Elizabeth in Zaire; and in my book THE CONSPIRACY AGAINST THE DOLLAR, I outlined the overall plan, including the unseen role of America’s gold. I had one major advantage which Ian Fleming did not have. The United States does not yet have an Official Secrets Act like that of Britain, and so I was not forced to fictionalize. Instead I was able to give the real plans and real names of those responsible for things to come.

The prototype for Ian Fleming’s GOLD FINGER of two decades ago was none other than David Rockefeller, and in my book I showed in detail how he played his kingpin role in the plan to destroy our economy. I described how this was leading to a collapsing dollar, skyrocketing gold prices, a stagnating economy, spiraling financial problems for State and local governments, urban unrest, and eventually NUCLEAR WAR. But when David Rockefeller himself was interviewed about my book, even he resorted to the technique “Fictionalize to close eyes.” His comment about THE CONSPIRACY AGAINST THE DOLLAR was: “Interesting science fiction.”